Brave man, Mr Lebedev.
With today’s sale announcement, it’s now clear why INM started to row back from its ambition to bring the Independent and the Independent On Sunday to breakeven point by the end of 2010.
Originally, that target emerged last summer as part of the effort to placate renegade investor Denis O’Brien. But towards the end of last year, the mood music from inside INM changed. One-third of the papers’ ad revenues had vapourized by recession. Perhaps the target wouldn’t be reached after all.
Now INM has disclosed that the Indies made an operating loss of £12.4m during the year to December 2009. That’s on the back of revenues of less than £70m (as we found out courtesy of the Office of Fair Trading last week.) These numbers followed cost cuts of £20m between 2007 and last year.
Huge cost cuts, a dwindling revenue base and a thumping great big loss: the advertising downturn has battered the Independent like no other broadsheet.
Neither is this the first time that the Independent has failed to reach a break even target. Last year’s promises sounded eerily like those advanced by INM during the mid-noughties.
If Alexander Lebedev can turn this one around without going free, it’ll be an astonishing achievement. If he does it with free distribution, well, that will merely be remarkable.
The Russian billionaire deserves thanks for saving a large number of journalists’ jobs. But surely he will need to continue INM’s cost-cutting. In addition, the prospect of a round-the-clock working arrangement with the Standard looms large.
The honeymoon, if there is one, will be short.